A highly respected commercial lawyer has been drafted in by a group set up to sue Tesco over last year’s accounting scandal in what could turn into a multi-billion pound lawsuit.
Philip Marshall QC represented Paddy McKillen in his epic battle with the Barclay brothers over ownership of the Claridge’s, Connaught and Berkeley hotels, grilled Bernie Ecclestone in the High Court for three days over the sale of the Formula One business to CVC and fought for the largest group of fraud actions ever to be brought in the High Court against Kazakhstan’s BTA Bank.
He will advise the various institutional investors who have been signed up by the Tesco Shareholder Claims (TSC) group and a formal claim is expected to be filed later this year.
The revelation is another blow to Tesco, which is under intense scrutiny and investigations by the Serious Fraud Office, the Groceries Code Adjudicator and the Financial Reporting Council.
Last month its chief executive Dave Lewis dumped the company’s auditor of 32 years, PwC, for failing to spot the accounting scandal that saw the supermarket’s commercial division notching up profits from supplier payments before those payments had been received.
An internal report by Freshfields and Deloitte found that £263m had been “mis-stated” over at least the last three years, although this figure was revised up to £326m last month as further discrepancies were found in the supermarket’s Irish business.
The TSC, along with British law firm McGuireWoods and US attorneys Scott and Scott, which are filing a similar claim on behalf of US shareholders, claim the scandal wiped between 50p and 70p permanently from the value of the shares, meaning the total bill could be as high as £1.9bn.
David Scott, managing partner at Scott and Scott, said: “Our investigation over the last few months has shown that Tesco committed serious violations when it overstated its profits. We intend to pursue Tesco in order to help our clients recoup their losses.”
The addition of Marshall to the legal fight will give a major boost to the cause following his performances in several, high-profile cases. In 2013 he rattled Mr Ecclestone in court, accusing him of “fabricating” evidence in an albeit unsuccessful attempt by the German media company Constantin Medien to sue the F1 boss. Mr Marshall, of Serle Court Chambers, also represented Liverpool FC directors when the club was sold to Fenway Sports Group in 2010.
Tesco declined to comment when contacted.
The news comes as the supermarket lost its battle with residents of London’s Belsize Park, where bosses were hoping to build a new store. The plans faced heavy resistance from famous local residents including Tom Conti and Janet Suzman.
Businessman Andrew Thornton, who runs the local Budgens store, revealed the plans were pulled on Wednesday night.Reuse content